Formerly About Applied Materials Message Board

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Politics : Formerly About Applied Materials

AMAT 261.28

+0.8%

Dec 15 3:59 PM EST

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To: The Vinman who wrote (18940)	4/22/1998 1:40:00 PM
From: Joe Sabatini	Read Replies (1) of 70976

>>If the S&P gets to a PE of 35 to 40, which it never will... At the end of December, would you have guessed the NASDAQ would be over 1900 now? Because of low interest rates and the lack of other places to put money, there is a feeding frenzy going on. Upgrades are being given out based on extremely thin reasoning, ignorant of important economic events and trends. I think the average PE on the S&P will at least approach 35, and companies like Microsoft will be trading at over 100 PE next year. Think about it. Microsoft stock is going up despite the fact that they will grow at most 20-25% this year. They are one of the annointed ones. Everyone loves Microsoft and expects at least 50% return per year out of them. New investors are piling in. We can see that their stock price will continue to far outstrip their actual growth rate. The same will happen for companies like Intel (30 PE this year), Cisco (80-90 PE this year), etc... Crazy stuff, but this is what will happen. Joe S.

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